Sephora Succeeds Again: Inside Sailthru’s Third Annual Retail Personalization Index
September 17, 2019
Every summer, Sailthru browses retailers’ websites, signs up for email lists and downloads their mobile apps. Then we begin to analyze what comes next. We added items to our online shopping carts, cross-referenced newsletter content with our browser history, rated the relevance of recommendations, and the list goes on (and on…) Our proprietary methodology and exhaustive research, which also includes a survey of 1,500 consumers, culminates with the Retail Personalization Index, in which we determine which brands were best able to show us that they know us.
Boston Consulting Group found that personalized marketing results in retailers’ sales increasing by 6 to 10%, two to three times higher than their non-personalizing competitors. At the same time, personalization is a broad concept that encompasses everything from pasting a customer’s first name in an email subject line to mobile apps designed for connecting shoppers with their favorite salespeople. Personalization is a game-changer for marketers, but executing it is often easier said than done. That’s why we started the Index in 2017.
Since then, the Index has grown in more ways than one. In June, McKinsey wrote that “personalization will be the prime driver of marketing success within five years.” Scores reflect that. The gap between #1 and #100 is 41 points; two years ago, it was 61.
As brands’ personalization prowess has evolved, so have consumers’ expectations. We’ve evolved our methodology to include more offline elements and customer sentiment. Some brands, like Sephora and Nordstrom, have been clear standouts from the beginning. Others, like Adidas and Rent the Runway, have risen through the ranks and become personalization pros.
Read on to learn some of the key takeaways from the findings — and stay tuned for more content — including trends and insights by retail category — on the Sailthru blog.
Omnichannel Personalization Leads to Satisfaction
Omnichannel personalization had a strong correlation with customer satisfaction. The stronger the connection between a digital and in-store channels, the more likely people are to enjoy their shopping experiences with the brand. Just 16% of the 250 retailers use customers’ digital data to personalize their in-store experience. However, that number is 100% among the top 10.
Unified Profiles as the Differentiator
More than anything else, unified customer profiles are indicative of a truly personalized customer experience. Consumers expect brands to provide consistency across every touchpoint, but only eight brands tie all their different channels together to create one cohesive experience. Six of those eight made the top 10.
Personalization Pros Master Triggered Messages
Largely behavior-based responses to customer actions such as abandoning an online shopping cart or making a purchase, triggered messages account for 77% of email ROI. Triggered messages are inherently more personalized than generic batch-and-blast campaign sends. The top performers excelled at both sending and capitalizing on them with personalized product recommendations.
Smartphones at the Center
Mobile was a litmus test for a brand’s overall personalization prowess. And many retailers don’t seem to grasp the importance of this channel. Compared with website and email, mobile scores were by far the lowest, on average. Of the 22 brands to earn at least 15 points, all but one made the top half. Seven placed in the top 10.
Luxury’s Continued Improvement
The in-store experience is the bread and butter for luxury brands, which historically underperformed when it comes to digital transformation. Nordstrom and MATCHESFASHION were anomalies, highly-personalized luxury players. Now, they’re joined in the top 25 by Rent the Runway, Revolve, The RealReal and Saks Fifth Avenue.
Looking to Learn More about the Sailthru 100?
Click here to learn more about Sailthru’s Retail Personalization Index, including all 100 brands we ranked. You can also access resources to help define your own personalization roadmap, get your own experience score, and discover how you can improve it.
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